The Saudi Central Bank (SAMA), previously known as the Saudi Arabian Monetary Agency, is the central bank of the Kingdom of Saudi Arabia. Established in 1952, its primary objective is to maintain the stability of the Saudi Riyal (SAR), the national currency, and to ensure the growth and soundness of the country's financial system.
Some of the key functions and responsibilities of the Saudi Central Bank include:
- Monetary policy: SAMA is responsible for formulating and implementing monetary policy to achieve price stability and maintain the stability of the exchange rate. The bank uses various monetary policy tools, such as open market operations and reserve requirements, to manage liquidity in the banking system and influence interest rates.
- Supervision and regulation: SAMA oversees and regulates the financial sector in Saudi Arabia, including commercial banks, insurance companies, finance companies, and other financial institutions. Its role is to ensure the safety and soundness of these institutions, protect consumers, and promote financial stability.
- Foreign exchange and gold reserves management: SAMA manages the country's foreign exchange and gold reserves, which are crucial for maintaining the exchange rate stability of the Saudi Riyal and ensuring the country's financial stability.
- Currency issuance: The bank is responsible for issuing and managing the supply of the Saudi Riyal, including the design, production, and distribution of banknotes and coins.
- Payments system: SAMA oversees the operation and development of the national payments system, ensuring its efficiency, safety, and reliability.
- Fiscal agent: The bank acts as a fiscal agent for the government, managing its accounts, providing financial advice, and executing monetary transactions on behalf of the government.
- Financial stability: SAMA plays a crucial role in promoting financial stability by monitoring and assessing potential risks to the financial system and implementing macroprudential measures when needed.
The Saudi Central Bank is governed by a Board of Directors, headed by the Governor, who is appointed by royal decree. The bank operates independently of the government in its policy-making but works closely with the government on matters related to the country's economic and financial policies.